Saturday, December 27, 2008

"Given the alternatives of doing nothing and tolling more aggressively, indexing the gas tax is the smartest investment for Texas."

Gas tax indexing a good investment


San Antonio Express-News
Copyright 2008

New data from the Census Bureau puts Texas tied for third among the fastest growing states in the nation, with 2 percent population growth. Numerically, Texas was the growth winner, adding 484,000 new residents from July 1, 2007 to July 1, 2008.

Good times or bad, Texas is experiencing rapid growth. In fact, a weak economy may bring even more newcomers in search of jobs and affordable living. But the state's capacity to build and maintain a transportation infrastructure isn't anywhere close to keeping pace with that growth.

A group of civic and business leaders appointed by Texas Transportation Chairwoman Deirdre Delisi has put a price tag on state transportation costs over the next 22 years. The 2030 Committee estimates Texas will need $313 billion for transportation alone during that period, or more than $14 billion annually. TxDOT's entire budget for 2008 was $8 billion.

The 2030 Committee's findings are largely in line with a report Texas Comptroller Susan Combs issued last year. She found an annual $8 billion shortfall in needed highway, bridge and aviation project investments.

Texas needs more money for transportation, and it can only come from two sources: tolls [i.e. taxes] or taxes. Either way, Texans are going to need to pay for them. And while there's a necessary and proper place for toll projects in transportation planning, the first objective should always be for the state to make the proper investment in Texas roadways.
While the Texas population and the cost for road construction have been growing, the Texas motor fuels tax — which is supposed to fund transportation projects — has been stuck at 20 cents a gallon since 1991. No one likes a tax increase, and no lawmaker wants to propose one. But, the status quo makes no sense.

Gas prices are down from more than $4.00 per gallon this summer to about $1.50. Most consumers wouldn't mind paying a few extra pennies dedicated to transportation infrastructure, especially if they knew it would decrease road congestion and the need for toll roads.

The Legislature should, at the very least, index the motor fuels tax to the cost of highway construction. That way, Texas won't fall any further behind than it already it is. A similar argument can be made for the federal gas tax. The last time it increased was in 1997, from 18.3 cents to 18.4 cents per gallon.

Gas tax indexing isn't an excuse for more fiscal irresponsibility, such as the diversion of one-quarter of the State Highway Fund.

But given the alternatives of doing nothing and tolling more aggressively, it's the least bad alternative and the smartest investment for Texas.

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